Plaintiffs, developers of new residential buildings in the Town of Hartford, appeal from the order of the superior court, which held that 24 V.S.A. § 3615, as that statute read in 1986, authorized the Town of Hartford to impose an impact fee on new developments to finance future expansion of the Town’s sewage capacity. Defendants appeal the trial court’s award of attorney’s fees to plaintiffs. We affirm in part and reverse in part.
The Town of Hartford operates a municipal sewage system to which all residential buildings are required to be connected. On December 29, 1986, the Town’s Board of Selectmen passed a resolution imposing a “Plant Impact Fee” on all residential structures not occupied before January 1,1987, and on existing residential structures requiring additional demand for sewage services after January 1, 1987. The Town assessed the impact fee at a rate of $600 per bedroom and assumed each structure would have three bedrooms, for a total fee of $1800 for each affected structure. The purpose of the Plant Impact Fee was to collect capital funds to finance the future expansion of the Town’s sewage capacity.
Plaintiffs, after incurring and paying the Plant Impact Fee, filed suit to declare the Plant Impact Fee illegal, to enjoin the Town from further enforcement, and to recover their payments and other damages, including attorney’s fees and costs.
After a bench trial, the court entered judgment for defendants. The court held that 24 V.S.A. § 3615 authorized the Town to impose the Plant Impact Fee and that the fee rate was both reasonable and rationally related to the Town’s purpose of financing expansion or new construction of sewage facilities to meet anticipated needs. The court, however, also held that the 1986 resolution 1 was “defective” insofar as it lacked a mechanism for returning capital funds that went unexpended after a *189 reasonable period of time. The court found that this defect was not fatal to the operation of the Plant Impact Fee and ordered the Town to amend its ordinance to require the refund of monies not expended within six years of collection. Nevertheless, the court awarded attorney’s fees to plaintiffs, on the theory that plaintiffs’ suit, though not successful, had been “meritorious” in bringing to light a defect that ultimately preserved a so-called “common fund.”
Plaintiffs appeal the trial court’s findings that the Town had acted pursuant to statutory authority when it imposed the impact fee and that the fee rate was reasonable and related to a legitimate public purpose. Defendants, on cross-appeal, claim that it was error for the trial court to award attorney’s fees and costs to plaintiffs, who had not prevailed on any of their claims. We address these issues in turn.
I.
Plaintiffs first argue that the trial court erred in holding that 24 V.S.A. § 3615 authorized the Town to impose the Plant Impact Fee. At the time the Town enacted its Plant Impact Fee in 1986, § 3615 authorized a municipality to establish sewage disposal charges, “to be paid at such times and in such manner as the [municipal sewage disposal] commissioners may prescribe,” based on: (1) metered water consumption; (2) the number and kind of plumbing fixtures; (3) the number of persons residing in or frequenting the premises served; (4) the appraised value of the premises; or (5) a combination of the enumerated bases or “any other equitable basis.” 24 V.S.A. § 3615 (1983) (amended 1989). 2
Plaintiffs argue that § 3615 permitted municipalities to impose a sewage charge only to recoup money expended on an *190 existing municipal sewage system, not to collect money in anticipation of future needs. Plaintiffs also argue that even if § 3615 did contemplate charges for future needs, the statute required that the Town use an “equitable basis” for establishing such charges; they contend that the Plant Impact Fee does not use am “equitable basis” and must be struck down. We believe plaintiffs’ interpretation of § 3615 is too narrow.
Before turning to plaintiffs’ arguments, we note that in Vermont a municipality has only those powers and functions expressly granted to it by the legislature, such additional functions as may be incident, subordinate or necessary to the exercise thereof, and such powers as are essential to the declared objects and purposes of the municipality.
Bryant v. Town of Essex,
A.
Plaintiffs contend that § 3615 cannot authorize the Plant Impact Fee because the fee is not a “sewage disposal charge” based on actual use. They point to our holding in
Kirchner v. Giebink,
Defendants do not dispute that they did not base the Plant Impact Fee on any of the first four bases enumerated in § 3615. Defendants claim, however, that they acted pursuant to § 3615(5), which permits sewage charges based on a combination of the enumerated bases “or any other equitable basis.” Defendants argue that this Court, in
Handy v. City of Rutland,
*191
In
Handy,
we held that § 3615 authorized the City of Rutland to impose an impact fee on extraterritorial users to defray the costs of expanding the city’s sewage system.
Id.
at 402,
Plaintiffs contend that
Handy
authorizes only extraterritorial exactions under § 3615, and not, as here, municipal ex-actions on planned sewage use within the municipality’s borders. Plaintiffs are correct that our decision in
Handy
involved an exaction on extraterritorial users not otherwise subject to municipal controls.
Id.
at 402,
We believe that in this case the Town also exercised proper authority under § 3615. When the Town passed its 1986 resolution, regulations required the Town to begin planning for expanded sewage capacity when its current facilities reached eighty percent of total capacity. In implementing the Plant Im *192 pact Fee through the 1986 resolution, the Town exercised a laudable degree of foresight and attempted to soften the blow that a more rapid planning and construction schedule might entail. The Town's foresight was borne out by the fact that daily usage of its sewage system increased from forty-five percent of capacity to sixty-five percent of capacity in the time between the passage of the 1986 resolution and the 1991 trial. Under these circumstances, we are hard pressed to view the Town’s actions as falling outside the limits of § 3615.
Plaintiffs, however, argue that the provisions of chapters 97 and 101 of Title 24, when read in pari materia, restrict a municipality’s power to impose sewage charges under § 3615. Specifically, they contend that even if we read § 3615 to allow a municipality to impose sewage charges not based on actual use, that power is limited by the restrictions on the use of those charges authorized in § 3616. We disagree.
Plaintiffs are correct that this Court must read provisions that are part of the same statutory scheme in pari materia.
Drumheller v. Shelburne Zoning Bd. of Adjustment,
In § 3616, as that statute read in 1986, the legislature required that a municipal sewage department’s “charges and receipts” “shall only be used and applied to pay the interest and principal of the sewage disposal bonds of such municipal corporation as well as the expense of maintenance and operation of the sewage disposal department or other expenses of the sewage system.” 24 V.S.A. § 3616 (1983) (amended 1989).
Plaintiffs argue that § 3616 limits a municipality to three types of expenditures: (1) repaying the interest and principal of sewage disposal bonds; (2) paying current maintenance and operating expenses of the sewage system; or (3) paying other expenses of the system. They urge us to read the words “other expenses” in the final phrase of § 3616 to mean “other current expenses,” i.e., identifiable and specific costs, and not to mean unspecified future expenditures.
*193
We are constrained from reading the word “expenses” in § 3616 to mean only “current expenses” or “operating expenses.” First, § 3616 by its express terms permits a municipality to use sewage charges to pay “the expense of maintenance and operation of the sewage disposal system
or
other expenses of the sewage system” (emphasis added). If we read the words “other expenses” to mean the same as “the expense of maintenance and operation,” then the statute contains a redundancy. We will not interpret a statute in a way that renders a significant part of it pure surplusage.
State v. Beattie,
Chapters 97 and 101 of Title 24 do not specially define the word “expenses.” The ordinary meaning of the word “expense” is “[a]n outlay, charge; cost; price.” Black’s Law Dictionary 577 (6th ed. 1990). We note that plaintiffs, in their brief, use the words “expenses” and “costs” interchangeably when discussing the application of §§ 3615 and 3616. We also note that chapter 91 of Title 24 defines “expense” as a “cost,” i.e., “the cost of architects, surveyors, engineers, contractors, lawyers or other consultants or experts as well as current operating expenses to be incurred by the [consolidated water] district.” 24 V.S.A. § 3343(b) (emphasis added). Chapters 91 and 105 of Title 24 provide special definitions of the words “cost,” id. § 3341(b)(4), and “costs,” id. § 3672(a)(8). As these definitions are nearly identical, we set forth the definition of “costs” from 24 V.S.A. § 3672(a)(8), which relates to consolidated sewer districts:
“Costs” as applied to a sewage system include the purchase price of any such system, the cost of construction, the cost of all labor, materials, machinery and equipment, the cost of improvements, the cost of all lands, property, rights, easements and franchises acquired, financing charges, interest prior to and during construction and, if deemed advisable by the sewer commissioners for one year after completion of construction, cost of plans and specifications, *194 surveys and estimates of cost and of revenues, cost of engineering and legal services, and all other expenses necessary or incident to determining the feasibility or practicability of such construction.
24 V.S.A. § 3672(a)(8) (emphasis added).
When the same word is used in statutes in pari materia, it will bear the same meaning throughout, unless it is obvious that another meaning was intended.
State v. Welch,
B.
Plaintiffs argue, however, that the impact fee is not “equitable,” as required by 24 V.S.A. § 3615(5), because it does not treat all town residents equally, and because each affected contributor pays for the equivalent of 150 gallons of water per bedroom for three bedrooms, even though in some cases actual water usage is significantly less than 150 gallons per bedroom and the actual number of bedrooms is fewer than three. Plaintiffs are correct that a municipal exaction under § 3615(5), even though not based on actual water or sewer usage, must nonetheless be “equitable.”
Handy,
Plaintiffs first argue that the impact fee is inequitable because it does not treat all residents equally. This argument is insupportable under Vermont law. We have consistently upheld disparate classifications of property if the classification is reasonably related to the purpose for which it is established. See, e.g.,
In re Property of One Church Street,
Plaintiffs’ second argument is that the impact fee is inequitable because it does treat all affected contributors equally, regardless of their actual usage. As we discussed above, we do not view 24 V.S.A. § 3615 as requiring a town to base a sewage charge on actual sewage usage only. The trial court found that the Town had based its Plant Impact Fee on gallonage allocation standards established by the United States Environmental Protection Agency and adopted by the Vermont Agency of Natural Resources. These standards establish the amount of reserve capacity a municipal sewage system must set aside for each structural type, regardless of a particular structure’s actual usage. According to these standards, each residential connection to a municipal sewage system requires the system to reserve sewage capacity equal to 150 gallons of water per bedroom per day, with each residence deemed to contain three bedrooms on average. On this basis, the Town assessed a Plant Impact Fee of $1800 for each affected structure.
In
Handy,
we found that a hookup fee based on “the maximum amount of effluent that may be discharged under plaintiffs’ Act 250 permit” was “certainly” equitable under § 3615(5).
Handy,
For the foregoing reasons, we conclude that the Town’s basis in imposing the Plant Impact Fee was “equitable” under 24 V.S.A. § 3615(5).
*196 II.
Plaintiffs also claim that the trial court erred in holding that the fee rate itself was reasonable and bore a “rational nexus” to a legitimate public purpose. They appear to rely on our holding in
Handy
for the proposition that municipal sewer rates, when authorized by statute, must undergo a separate determination of their reasonableness.
Handy,
Plaintiffs ask us to extend the
Handy
decision to all municipal sewage rates. We need not reach this question, for we find as a matter of law that plaintiffs have failed to sustain their burden of proving that the Selectboard’s actions were unreasonable. As we clearly stated in
Handy,
“because the rates established by a lawful rate-fixing body are presumed reasonable, the persons challenging the rates bear the burden of showing that they are unreasonable.”
id.
at 404,
At trial, plaintiffs presented evidence showing that the Town had not conducted studies to determine the necessity or cost of additional sewage capacity. But plaintiffs presented no studies of their own showing that additional capacity was not necessary or that the costs were unreasonable. See
id.
at 405,
Plaintiffs also failed to present any evidence that defendants acted arbitrarily or unreasonably in calculating the fee rate itself. Indeed, the trial record discloses that plaintiffs’ witnesses offered testimony showing that the Town used four separate *197 bases to determine its impact fee rate: (1) the actual cost of constructing the Town’s sewage facilities ten years earlier, which came to approximately $5 per gallon per day without correcting for inflation; (2) the advice of consultants that the cost of constructing new wastewater treatment capacity in Vermont was $5-6 per gallon per day of additional capacity; (3) the advice of the Agency of Natural Resources that a $4 per gallon figure for adding new sewage capacity was “a low figure” and thus acceptable under guidelines that required the Town to charge no more than the actual cost of construction; and (4) information provided by “five or six communities in the state who had some sort of capital or impact fees in place right now” and whose “computations on average indicated around five dollars and forty cents per gallon ... [for] adding new wastewater treatment plants.” The record reflects that the Town’s decision to fix a $4 per gallon impact fee was neither arbitrary nor unreasonable. We hold that it was not error for the trial court to find that the Plant Impact Fee was reasonable.
Thus, we need not reach plaintiffs’ contention that the trial court erred in finding that the Plant Impact Fee bears a “rational nexus” to the declared municipal purpose. Plaintiffs acknowledge that Vermont has not heretofore adopted the “rational nexus” test for determining the validity of municipal charges and fees. But cf.
Vermont Ass’n of Realtors v. State,
III.
Finally, defendants on cross-appeal claim as error the trial court’s award of attorney’s fees and court costs to plaintiffs under an apparent “common fund” theory. We agree and reverse this award.
*198 The trial court awarded attorney’s fees to plaintiffs, even though they had not prevailed on any of their claims, because their lawsuit had uncovered a “defect” in the Town’s impact fee resolution, namely, that the enactment failed to provide for the refund of capital funds that went unexpended for a reasonable period of time. The court ordered the Town to amend its resolution to provide for a refund mechanism. The court then awarded attorney’s fees to plaintiffs, reasoning that the refundable monies represent “a common fund . . . created in part by the contributions of the named plaintiffs here, and protected by the efforts of their attorneys in bringing to light the potential invalidity of the ordinance.”
Vermont has consistently applied the American Rule with respect to the award of attorney’s fees.
Anderson v. State,
In other jurisdictions that apply the American Rule, the courts have created certain “equitable exceptions” to the Rule, such as the principles of “common fund,” “private attorney general,” “vexatious litigant,” and “substantial benefit.”
Residents ad hoc Stadium Comm. v. Trustees of Cal. State Univ.,
Under the “common fund” doctrine, relied on by the trial court in the instant action, attorney’s fees are not paid by the
*199
losing party, but rather by the prevailing party out of the recovered damages.
Bowles v. Washington Dep’t of Retirement Sys.,
There are cases that permit an award of attorney’s fees even though no money damages were in fact recovered or recoverable. Such cases apply the “substantial benefits” principle, which is an extension of the common fund doctrine.
Braude v. Automobile Club of S. Cal.,
Vermont has not recognized the “common fund” exception, and we see no reason to do so today. Although the trial court characterized plaintiffs’ lawsuit as “meritorious,” the court nonetheless rendered judgment for defendants on all counts. Moreover, the court’s order to provide a refund mechanism for unexpended impact fees did not create a “common fund” in the classic sense. The order merely provided an incentive to the Town to expend revenues generated by the Plant Impact Fee within six years. In any event, any benefits accruing to plaintiffs or to others similarly situated “are not actual or concrete but are potential, conceptual, intangible and doctrinal in nature.”
Braude,
The award of attorney's fees to plaintiffs is reversed. In all other respects, the judgment of the superior court is affirmed.
Notes
The trial court referred to the 1986 resolution as an “ordinance,” but the record is clear that the enactment was in the form of a resolution. We have previously held that a municipality may impose impact fees by resolution only if the resolution satisfies the requisites of an ordinance.
Herbert v. Town of Mendon,
Sections 3615 and 3616 were amended in 1989 to provide greater flexibility for municipalities to impose sewage charges. 1989, No. 45, §§ 5, 6. Section 3615 now permits municipalities to “establish annual charges separately for ... fixed operations and maintenance costs (not dependent on actual use), and variable operations and maintenance.” Section 3616 now permits municipalities “to develop a dedicated fund which may be created by the [sewage] commissioners to finance major rehabilitation, major maintenance and upgrade costs for the sewer system.” In addition, with the enactment of Act 200 in 1988, municipalities were granted general authority to impose impact fees to finance capital projects. See 24 V.S.A. §§ 5200-5206.
In at least two cases, plaintiffs lost on their individual claims and yet were awarded attorney’s fees under equitable theories.
Parham v. Southwestern Bell Tel. Co.,